Market share and market growth are different ways to analyze and evaluate a marketís performance and dynamics.


Market Share:
  • It is the fraction of total sales in a market that a company or product has over a time period.
  • It is calculated by dividing a companyís sales revenue (or units sold) by the total market sales and multiplying by 100 to get a percentage.
  • It shows how strong a companyís presence and customer base are in the market. It is often used to compare the competitiveness and dominance of a company in an industry.




Market Growth:

  • It is the percentage change in the market size over a time period. For eg in year 2020 you had 5000 customers but in year 2021 you have 8000 customers.So this change in market size is market growth .
  • It is calculated by comparing the market size at the end of a period with the market size at the beginning of that period. The formula is [(Final Market Size - Initial Market Size) / Initial Market Size] * 100.
  • It shows how the market is expanding or shrinking over time. It is important for companies that want to grow or enter a market, as it indicates the demand for products or services in that market.




In summary, market share measures a companyís share of the total market, indicating its competitive position, while market growth measures how the whole market is changing over time. A company can have a high market share in a slow-growing market or a low market share in a fast-growing market. Both metrics are essential for understanding the overall health and potential of a business within its industry.